DOHA: Qatar Investment Authority’s subsidiary Qatar Holding has committed to invest $250 million in Mumbai-based ArthVeda Fund Management’s affordable low and middle income fund. This is the first such commitment received by an Indian fund following the Budget 2017 proposal to grant affordable housing infrastructure status.
“The subscription of the entire corpus of its FDI-compliant affordable housing fund by Qatar Holding was the first substantial foreign inward investment into India’s affordable housing segment spanning low and mid-income residences, immediately after India’s Union Budget on Feb 1, 2017,” said Bikram Sen, CEO of Arthveda.
ArthVeda Fund Management’s affordable low and middle income (LMI) fund will be investing in housing projects across top ten cities and is targeting Internal Rate of Returns of over of 18%-21%.
Union Budget for 2016-17 has proposed infrastructure status for affordable homes along with several other measures for the real estate sector that will help the government push forward its efforts to provide housing for all by 2022.
The move is expected to help developers of affordable housing get access to institutional financing at lower interest rates as well as tax exemptions that will help them manage margins better. The measures are aimed at encouraging companies to build more affordable housing, thus boosting supply and keeping prices in check.
